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BGF sees business confidence grow in 2021 with close to £33m invested in Scottish firms so far

BGF News 29.07.2021.
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Throughout the last six months, the investment team for Scotland has invested close to £33 million across 10 Scottish growth businesses, including a cornerstone investment that marked BGF’s second investment in a Scottish IPO in 12 months.

BGF is a long-term patient investor, making initial investments between £1 million to £15 million for a minority equity stake. It backs ambitious teams across a range of sectors and funds a variety of growth plans.

“Despite ongoing disruptions caused by the Covid-19 pandemic, we’ve been extremely busy in the first half of the year. The team has invested nearly £33 million across a range of very different companies, from early-stage technology to e-commerce and to the healthcare sector – proof of continued, strong demand for capital among ambitious businesses in the region.

“Although there remains a significant level of uncertainty in the market, we are very optimistic about the outlook for growth businesses, with a high level of confidence in the management teams running the great companies in our portfolio.”

Patrick Graham, head of Central Scotland and Northern Ireland

In June, BGF invested £7 million in The Artisanal Spirits Company limited (ASC), specialist retailer of premium single cask, single malt Scotch whisky and other spirits, as part of its admissions to trading on AIM.

The funds raised through the IPO, which achieved a valuation of around £78 million, along with the company’s existing cash resources, will allow Edinburgh headquartered ASC to develop its membership base, enhance its digital channels, grow internationally and bring new brands to market.

The deal follows BGF’s investment in Calnex Solutions plc as part of the Linlithgow-based provider of test and measurement solutions for the global telecommunications sector’s IPO in September 2020.

BGF investments in Central Scotland include: £4 million into social care provider CSN Care Group; £5.2 million in Odro, a Glasgow business that makes video interviewing and engagement software for recruiters; £5 million in Edinburgh headquartered natural pet food producer Bella & Duke; and part of a $4 million investment round in Edinburgh-based Desana, a flexible hybrid workspace platform for global employers.

Many of BGF’s existing portfolio companies in Central Scotland are also celebrating growth in H1 of 2021.

  • Following a £2.7 million investment from BGF in 2020, Stirling-based paint and accessory retailer The Paint Shed opened its eighteenth store in Aberdeen in May.
  • Walker Precision, the Glasgow-based specialist engineering firm achieved Nadcap Gold status, joining a select few organisations to be awarded this highest accreditation – Nadcap is a global program designed to set standards for aerospace engineering, defence and other related industries.
  • Belfast-based window blinds manufacturer Mzuri Group completed the acquisition of TCMM Shutter Group in February, increasing the company’s headcount to 1,227.
  • BGF’s £2m investment in Country Antrim’s coffee & food shop chain Bob & Berts supported the firm’s expansion into England, with new stores now open in Lancaster and Kendal, and further sites planned for Preston, Perth and Dundee.

BGF expects to see continued demand for business funding in the latter half of 2021 as management teams assess their options.

Patrick Graham added: “Business may seek minority equity funding for a variety of reasons, for instance to develop products, expand overseas, or to provide fuel to continue growing prior to a full exit. BGF can provide funding for these reasons and many more, always as a minority, non-controlling shareholder.

“Although there are likely to be challenges ahead as government support, such as the furlough scheme, begins to taper, we are confident that the future is bright for ambitious, well-managed growing businesses and we are more than happy to have conversations with teams looking to expand and grow.”